- Growth continues to strengthen in 2026 yet employment declines and price inflation is the highest since October 2022.
- Sebastian Burnside, Chief Economist for Ulster Bank, said businesses showed “enhanced growth” despite “disappointing” employment data.
- Mark Crimmins, Ulster Bank Managing Director Corporate, Commercial and Business Banking, welcomed Northern Ireland being the strongest performing area for business growth in the UK outside of London.
The latest Ulster Bank Regional Growth Tracker saw rates of expansion in Northern Ireland gather momentum in February.
Sharper increases in new orders were recorded and business confidence strengthened. That said, inflationary pressures were also more pronounced, while companies continued to lower employment, leading to a rise in backlogs of work.
The headline Business Activity Index – a seasonally adjusted index that measures the month-on-month change in the combined output of the region’s private sector – signalled a rise in output for the second month running in February in line with greater new orders. Moreover, improving to 54.3 from January's 53.0, the index pointed to the fastest growth since October 2024.
The rate of growth was the second-fastest of the 12 UK regions and nations, behind only London.
Stronger increases in output in the manufacturing and services sectors outweighed reductions in activity in construction and retail.
Sebastian Burnside, Chief Economist for Ulster Bank, commented:
“So far, the opening quarter of the year has been positive for firms in Northern Ireland. Companies are increasingly able to bring in new business, leading to stronger output growth and enhanced confidence about the months ahead.
“It was a bit disappointing to see employment numbers continue to fall despite rising workloads. But a renewed increase in backlogs of work suggests that pressure on capacity is building and so we may see some more positive news on the jobs front soon.
“Inflation remains a headwind for firms, and potentially influencing hiring decisions, with both input costs and output prices increasing more quickly again in February. Demand held up well against the impact of higher prices, but this is something we will need to look out for as the year progresses.”
Mark Crimmins, Ulster Bank Managing Director Corporate, Commercial and Business Banking, added:
“Our Ulster Bank Growth Tracker found that growth in Northern Ireland’s business community strengthened last month, with confidence in further growth also increasing. Indeed, growth was stronger among Northern Ireland businesses than those in any other nation or region of the UK, aside from London, which is a compelling performance.
“So far 2026 has seen improved business growth. However, recent international developments and the increasing inflationary pressures identified in our data are a cause for concern for firms.”
Please see the regional report in full:
Ulster Bank Northern Ireland Growth Tracker (PDF, 919.5KB)
